Wednesday, 03 April 2024 04:52

Electricity tariffs to go up as FG increases prices of natural gas

Rate this item
(0 votes)

The federal government is planning an almost 300% increase in electricity tariffs in the coming weeks in a bid to attract investment into the sector according to reports from Bloomberg.  

According to the reports, unofficial sources state that electricity firms may hike tariffs for those in urban areas to N200 per kWh, up from N68. Those in urban centres represent just 15% of the population but reportedly consume around 40% of the nation’s power the anonymous source said.  

Special Adviser to the President on Information and Strategy, Bayo Onanuga told Bloomberg that NERC would announce a price increase soon and the government cannot speak on the matter for now.  

  • He stated, “The regulator will make any pronouncements based on its discussion with the distribution and generating companies. The presidency cannot say anything at this stage” 

What you should know 

Nigeria operates a fixed tariff system where the federal government sets the price of electricity through the Nigeria Electricity Regulatory Commission (NERC). For 2024, the federal government projected to spend around N1.67 trillion on electricity subsidy- an increase of 170% from the figure spent in 2023.  

  • According to the NERC’s guidelines, electricity distribution companies were to halt the subsidy regime in the power sector from the beginning of 2025. The IMF had earlier warned that subsidy on fuel and electricity tariffs could cost Nigeria up to 3% of GDP in 2024.  
  • President Bola Tinubu on assumption had earlier removed the decades-old fuel subsidy. However, there are feelers that the federal government has returned to the practice rationalised by the increase in global crude oil prices together with the depreciation of the naira in recent times.  
  • Just yesterday, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) increased the price of domestic natural gas used in generating about 70% of electricity to $2.42 MMBtu from $2.18.  
  • Minister of Power, Bayo Adelabu had earlier hinted at plans to sell gas to power plants across the country in naira occasioned by the dearth of foreign exchange in the country. 

 

Nairametrics

November 23, 2024

NNPC not delivering quantity of crude oil agreed on, Dangote refinery says

The federal government's plan to sell crude priced in the local currency is faltering, with…
November 22, 2024

Tinubu’s borrowing spree retuning Nigeria back into debt peonage - Atiku

Former Vice President Atiku Abubakar has criticized the President Bola Tinubu-led administration for the increasing…
November 23, 2024

Do these 3 things to feel happier today—they take less than 10 minutes

Prioritizing your joy can feel like an abstract assignment that, frankly, many of us don't…
November 16, 2024

Influencer eats pig feed in extreme attempt to save money

Popular Douyin streamer Kong Yufeng recently sparked controversy in China by eating pig feed on…
November 22, 2024

FG excited as pro-Biafra agitator Simon Ekpa arrested in Finland on terrorism charges

Simon Ekpa, the controversial leader of the pro-Biafra faction Autopilot, was arrested by Finnish authorities…
November 23, 2024

What to know after Day 1003 of Russia-Ukraine war

RUSSIAN PERSPECTIVE Putin announces mass production of Oreshnik missiles Russian President Vladimir Putin confirmed on…
November 21, 2024

Nigeria comes top in instant payment system inclusivity index in Africa

Nigeria’s instant payment system is projected to advance to the maturity inclusion spectrum ahead of…
October 27, 2024

Nigeria awarded 3-0 win over Libya after airport fiasco

Nigeria have been awarded a 3-0 victory over Libya, and three vital points, from their…

NEWSSCROLL TEAM: 'Sina Kawonise: Publisher/Editor-in-Chief; Prof Wale Are Olaitan: Editorial Consultant; Femi Kawonise: Head, Production & Administration; Afolabi Ajibola: IT Manager;
Contact Us: [email protected] Tel/WhatsApp: +234 811 395 4049

Copyright © 2015 - 2024 NewsScroll. All rights reserved.